Weyerhaeuser CEO Dan Fulton announced Aug. 5 that the company will cut 1,500 jobs, most at its Federal Way headquarters.

The cuts come after the company reported a $96 million quarterly loss. During the same period last year, the company reported a $32 million profit.

The jobs will be cut in phases through the end of 2009. The cuts will come in human resources, finance, information technology, external relations and other corporate functions, Weyerhaeuser spokesman Bruce Amundson has told media outlets. Some employees may get the chance to apply for new jobs within the company.

The company headquarters in Federal Way, which currently staffs 2,500 people, faces 1,000 job cuts. Weyerhaeuser is among Federal Way’s top employers.

“I’d like to send my condolences to the 1,500 employees who lost their jobs today,” Federal Way Deputy Mayor Eric Faison said at Tuesday night’s city council meeting. “It’s going to be a significant blow.”

After falling 30 percent in the first half of the year, Weyerhaeuser stocks rose 1 percent following Fulton’s announcement on Tuesday.

The cuts are among many ways that Weyerhaeuser is restructuring. The company also recently sold its packaging unit to International Paper for $6 billion and combined its fine paper business with Domtar Corp.

The company also announced this year that it plans to sell its Australian timber manufacturing business and maritime shipping and railway assets.

Weyerhaeuser has been hurt by the housing slump because it supplies lumber and building materials and is involved with real estate development.

“Weyerhaeuser is transitioning just like a lot of other companies are transitioning during (tough) economic times,” said Tom Pierson, Federal Way Chamber of Commerce CEO. “It’s going to make them a stronger and better company and we’re going to stand beside them during that process.”

Pierson estimated that of the 1,000 local employees who will lose their jobs, a few hundred live in Federal Way.

“I believe that this community will stand together to help each of those individuals as much as possible,” he said.

Because the positions will be cut over an 18-month period, Pierson said he doesn’t expect a large immediate impact on the local economy.

“Obviously there’s short-term effects,” he said. “The amount of people that are going to be going to lunch during lunchtime, those types of things.”

The lay-offs are likely to be one of many factors affecting the local economy, Pierson said. “What it’s going to do is it will just probably continue the economic downturn that we’re facing today.”

Contact Margo Hoffman: mhoffman@fedwaymirror.com or (253) 925-5565.